Gov. Schwarzenegger's health care reform plan promises that all California residents have access to health coverage.

The Health Care Security and Cost Reduction Act guarantees that no Californian will be turned away from buying insurance based on age and medical history.

The health care act aims to make coverage more affordable for individuals and families through tax credits and subsidies.

In order to achieve its goals, the legislation provides assistance to families of limited financial means and expands eligibility for programs such as Medi-Cal and Healthy Families programs.

Under the Health Care Security and Cost Reduction Act, no one will be forced to change insurance plans.

The state will create a new purchasing pool that will provide access to subsidized coverage to individuals and families with incomes 100% to 250% of the poverty level.

The act limits how much California residents will contribute toward the cost of the premium based on household income.

An income between 100% and 150% of the poverty level will require no contribution and 151% to 250% of the poverty level is limited to no more than 5% of income.

The legislation requires employers to let employees pay their health insurance premiums on a pre-tax basis, which is expected to bring tax savings.

The forecast for the pre-tax basis is that employees and employers will save approximately $2 billion in state and federal income taxes and federal payroll taxes.

The expected cost to an employer to establish the plan is $200 or less.

Opposition arises

Financing for the bill will come from various sources: $4.6 billion will come from federal funding, $2.6 billion from employer contributions, $2.3 billion from a 4% hospital fee, $2.1 billion from individuals, $1.5 billion from tobacco revenues and $1 billion from county fund shift.

But the bill has encountered resistance from officials in the health care industry.

"What started out as a promising year for major reform of our broken health care system is sadly ending with a deeply flawed, patched-together package that will leave the insurance companies in control of our health with millions of California families struggling to pay their medical bills," said Zenei Cortez, a registered nurse and member of the Oakland-based California Nurses Association Council, in a release.

The nurses' association feels that insurance companies will continue to deny care deemed "not medically necessary" or experimental.

Another concern raised by the association is that insurance companies can continue to charge whatever they want as the bill sets no limits on escalating premiums, deductibles and co-pays and individuals are forced to buy insurance without guarantees of what they are buying or whether they can afford the premiums and related medical care costs.

According to the statewide nurses' association, the bill fails to require employer contributions.

"Without an employer mandate, the concept of 'share responsibility' is out the window, and it just becomes an individual mandate bill, with all the onus and burden on individuals and families," said Donna Gerber, legislative director of the association, in a release.